Press Responses: October 1, 2006

Struggle at the top of the Andes

Kelly Patterson, The Ottawa Citizen
Published: Sunday, October 01, 2006

It's one of the biggest, boldest and most costly industrial ventures in the world -- a massive, open-pit gold mine carved into the peaks of the Andes, about 15,000 feet above sea level.

The world's first transnational mine, Barrick Gold Corp.'s $1.6-billion Pascua Lama venture would straddle the border between Chile and Argentina, which both had to sign special treaty provisions for the project.

It's a high-tech, high-stakes venture, in which Toronto-based Barrick -- the world's largest gold producer -- had at first planned to move three glaciers to get to gold and silver deposits worth more than $11 billion.

The deal would bring more than 5,500 temporary and 1,600 permanent jobs as well as millions of dollars in spinoff benefits to an area hit by 18-per-cent unemployment, Barrick says.

But Luis Faura, a farmer and councillor for the nearby Chilean municipality of Alto del Carmen, says the project, on track to start in January, will spell disaster for the 66,000 people who live in the area.

"I will oppose this project with all the strength I have," says Mr. Faura.

He and Lucio Cuenca of the Chilean environmental group OLCA travelled to Toronto last month to government-sponsored roundtable discussions on ethics and Canadian extractive industries operating overseas, where they pleaded with officials to ensure Canadian mega-projects abroad follow the same standards they would at home.

The roundtables, which bring together industry, the federal government and human-rights and environmental groups, were formed after a 2005 report by the Standing Committee on Foreign Affairs and International Trade called for "legal norms" to regulate Canadian mining and oil companies overseas. The roundtables resume next month in Calgary.

Mr. Faura lives at the foot of the mountains in the lush Huasco Valley, where about 700 farmers grow everything from avocados to grapes.

Runoff from the glaciers atop the stark, gold-rich peaks that tower above the valley is critical; without it, the valley would quickly turn into badlands in the desert-like setting of the high Andes, Mr. Faura explains.

He also fears the mine, which will use cyanide to leach gold from the ore, will contaminate the runoff in this unique area, which lies not far from a UNESCO biosphere reserve.

"There is no way the mine will not affect the water," he says. "It is already so dry here; the people in the valley next to ours only have enough water left for seven years. I don't want that to happen to us."

Barrick's plan touched off a national furore in Chile when it was revealed the mine planned to move three glaciers in its bid to mine about 18.3 million ounces of gold and 685 million ounces of silver; Chile's new president, Michelle Bachelet, made a pledge to protect them part of her campaign last winter.

In February, Chilean officials approved the project, but ordered Barrick not to disturb the glaciers.

The company then revised its plans, leaving as much as a million ounces of gold untouched, says Barrick spokesman Vince Borg. "Our plan will not affect the water supply in any way," Mr. Borg stresses.

Barrick has spent almost $17 million in Chile alone on its 5,300-page environmental assessment, gaining input from farmers as well as major technical firms and universities, he says.

Barrick's state-of-the-art system will contain contaminated water and divert runoff from the mine, Mr. Borg says, adding that community-development projects such as irrigation initiatives will, in fact, "improve both the quantity and quality of water in the valley."

But Mr. Cuenca says Barrick's exploration activities have already affected the glaciers on the concession, named Toro 1, Toro 2 and Esperanza. "They put 13 drilling platforms in the Esperanza glacier. ... How can that not affect it?" he asks.

He also says dust from the operations coated the glaciers, accelerating the natural melting process. A 2005 report by Chile's General Water Directorate found "a 50- to 70-per-cent reduction in the area of the three glaciers" between 1986 and 2000, he says.

If the mine goes ahead, blasting during the construction phase would send tonnes of dust into the air every day -- a measure he says is certain to smother those as well as glaciers in the area.

Vince Borg confirms the company put 13 drill holes in the Esperanza glacier, but points out that Barrick's activities were "duly authorized by relevant authorities."

As for the argument that dust from mine activities has already affected the ice, "this is just talk. It is not true," replies Mr. Borg, who says government studies, including a 2005 report by CONAMA, Chile's national environmental commission, have consistently found no correlation between the mine's activities and the rate of melting.

Studies show Chile's glaciers are all melting at the same rate due to global warming, he adds.

"The icefields/glaciers at Pascua Lama are naturally dusty due to other wind-borne dust from the surrounding mountains -- without any mining activity," adds Mr. Borg. He says construction could put as much as six tonnes of dust a day into the air, but prevailing winds and dust-control measures mean less than 0.25 millimetres would actually settle on the glaciers.

Mr. Faura is also concerned the extreme conditions at the site will overwhelm the mine's containment systems, releasing tonnes of cyanide into the Huasco Valley water.

The area is subject not only to extreme weather, but earthquakes as well: the U.S. Geological Survey has recorded three earthquakes in the area with a magnitude of 6.7 or more in the past four years.

But Mr. Borg says cyanide treatment will be done in a closed system with multiple safeguards to prevent accidents.

"This will be a fully earthquake-proofed facility," Mr. Borg adds, explaining that technical experts have designed the site to withstand extreme conditions that exceed any in the recorded history of the area.

Mr. Cuenca also worries about the more than a billion tonnes of waste rock the mine plans to store near the headwaters of the Estrecho River. Waste rock is hazardous due to a process called acid rock drainage, in which sulphuric acid as well as toxins such as mercury, arsenic and cadmium leach out of exposed waste-rock piles.

Barrick stresses that all contaminated water will be captured and diverted for use at the mine.

The mine also plans to set up 34 automated water-testing points that will send up-to-the-minute reports that officials and the public can access; the system will be monitored independently, it says.

Mr. Borg says there is overwhelming support for the project on both sides of the border, where economic stimulation and development projects are desperately needed. "As of a month ago we had 53,000 applications for jobs," he points out.

But Mr. Faura says jobs and community aid will be of little comfort to the residents of the Huasco Valley if they lose their only water source.

"The company may give us little gifts right now, but once the area is contaminated and the company is finished and goes away, what are we left with?" he asks.